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A Spaniard convicted over controversial arbitration between Malaysia and a sultan's heirs Barron's

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In early January, the Spanish judiciary sentenced the man responsible for a $15 billion arbitration between Malaysia and the heirs of a 19th-century sultan to six months in prison, assessing that he had no authority to make the decision.

After a complex legal battle initiated by the state of Malaysia, a court in Madrid found Gonzalo Stampa guilty of “disobedience” for violating a court order that prevented him from acting as an arbitrator in the case.

The court sentenced the lawyer, who specializes in commercial disputes, to six months in prison and banned him from acting as an arbitrator for a year, according to the ruling issued on January 5, a copy of which was obtained by AFP on Monday.

The court emphasized that the decision that prevented Stampa from acting as an arbitrator did not leave “the slightest doubt”, for which the lawyer had to withdraw from the proceedings.

In February 2022, Stampa, president of a French arbitration tribunal, ordered the state of Malaysia to pay $14.9 billion to the heirs of the Sultan of Sulu in a financial dispute that dates back to the 19th century.

Malaysia has appealed this controversial arbitration. Pending a final decision, the Court of Appeal in The Hague, Netherlands, ruled last year that the award was unenforceable.

“We continue our fight for justice and we will continue our efforts to overturn the final verdict,” wrote Azalina Othman Said, a member of the cabinet of Malaysian Prime Minister Anwar Ibrahim, on the social network X.

The descendants of the Sultan of Sulu, who once ruled over the eponymous archipelago in the southern Philippines and the Malaysian state of Sabah, accused Kuala Lumpur of reneging on a late 19th-century commitment.

The hydrocarbon-rich state of Sabah came under the control of European colonial powers in 1878 under an agreement in which the Sultan and his descendants received annual financial compensation.

Malaysia continued to make payments after its founding in 1963, but paused in 2013 following a bloody incursion from the Sulu Archipelago, the subject of territorial claims by the Philippines.

Determined to restore these payments, eight of the Sultan's heirs sought financial arbitration in Spain, a former colonial power that had a presence in the Philippines until 1898. Eventually the arbitration was transferred to France.